Cautious optimism before GDP stats announced


With a string of positive economic reports recently released – strong quarterly results from publicly-traded giants Magyar Telekom and MOL followed by today’s report from the Central Statistics Office (KSH) showing a lower-than-expected inflation rate for July among them – the latest round of Hungary’s GDP figures tomorrow has become more anticipated than ever.

The Wall Street Journal expects the numbers, along with those of Poland and the Czech Republic, also to be delivered tomorrow, to indicate that the three economies have “turned the corner” to see “light at the end of the tunnel for countries hit by the Eurozone debt crisis.

In a post entitled “Central Europe Expected to Turn Economic Corner,” WSJ writer Veronika Gulyas writes that Hungary “is seen to have swung to annual growth from contraction a quarter earlier.”

The remarks in the Journal echo a forecast from Portfolio; according to its poll of analysts, tomorrow’s numbers will “likely confirm” Hungary’s emergence from recent recession. This analysis guesses that the Hungarian economy grew some 0.6% year-on-year after also increasing 0.7% quarter-on-quarter during the first three months of 2013.

Specific big increases are expected in the construction and agricultural sectors as well: On Monday, building sector association ÉVOSz announced results of its survey of construction-related businesses yesterday, figuring that Hungary’s construction industry expanded in the first half of the year – though due mostly to industrial-sector and infrastructure projects.

The surprising inflation rate for Hungary as well as the Czech Republic should have positive effects elsewhere: BRE economist Marcin Mazurek was quoted at WSJ as explaining that the results in these two countries “slightly increase the chance that Poland inflation will also surprise on the downside due to slower rise in food prices.”

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